Even Kentuckians who are familiar with the state's military history and its many war
heroes probably never have heard of Hugh Grundy.

But the Washington County native played a major, though behind-the-scenes, role in
one of the most debated periods of American history. Grundy, now 87, was president
of Air America, ostensibly a private airline, but in fact a CIA-front operation that flew
secret intelligence missions and carried food, ammunition, supplies and even livestock
for anti-Communist fighters in Laos, Vietnam and other parts of Southeast Asia from
the early 1950s to the early 1970s.

"Air America was the largest of a network of aviation companies that this giant CIA air
complex ran under a holding company called Pacific Corp.," says William Leary, the E.
Merton Coulter professor of history at the University of Georgia. "It was all classified.
And Hugh Grundy basically was the operational head of the entire complex."

The arrangement allowed the U.S. government to secretly do things that it couldn't
do openly because of political concerns. For example, the operation flew
ammunition and supplies to French forces surrounded at-Dienbienphu in 1954, at
a time when the United States officially was staying out of Vietnam.

Later, after the United States entered the war, Air America pilots, such as Lexington's
Lee Howell, flew into tiny jungle airstrips, often under fire, to deliver cargo and pick up
wounded.

One of the war's most famous photographs shows an Air America helicopter plucking
refugees from a Saigon rooftop during the collapse of South Vietnam in 1975.

In recognition of Grundy's service, the Aviation Museum of Kentucky is inducting him
tonight into the Kentucky Aviation Hall of Fame. Three other aviation pioneers with
Kentucky ties also are being inducted at Blue Grass Airport.

Hired by CAT in China

Grundy earned his pilot's license in Louisville around 1930, beginning an aviation career
that would take him around the world.

By 1941, he was in Africa, helping develop a commercial air route for Pan American
Airways. After serving as an Air Force major during World War II, Grundy went to work
for a Pan-Am affiliate in China. Soon after, however, he was hired as chief engineer
for CAT, a civilian airline in China launched by Gen. Claire Chennault, creator of the
famous Flying Tigers.

The U.S. government had been contracting with CAT for several years to fly classified
missions in China, then being overrun by the Communists.The CIA secretly bought
the airline outright in 1950, just about the time Grundy came on board.

"Very few people in the company knew that the CIA owned it," Grundy recalled. "I
didn't know myself until I was formally briefed on it about 1953."

Shortly after that, Grundy was named president of the company and suggested a name
change to avoid confusion with a similarly named operation. The new name was Air
America.

A balancing act

Most of Air America's operations involved straightforward commercial flying, moving
cargo and passengers. But revenue from that supported the classified missions
that no one talked about.

"It was designed not to cost the CIA anything, so it had to be a profit-making operation,"
said Leary, who has studied Air America's history. "On the other hand, it wasn't
supposed to make enough money to be competition for other American airlines. So,
running it was a balancing act.

"The CIA wanted somebody who could run it without drawing attention. And Grundy
played that role magnificently."

Working out of offices in Taiwan, Grundy directed an operation that, over the years,
involved up to 700 pilots and 10,000 employees. But it was so secret that Grundy's
wife, Frankie, never knew the true nature of his work until the CIA openly honored him
for his service in 2001.

"I had a boss in Washington who was a CIA person, but also an airline person,"
Grundy said. "He gave us directions as to what he wanted done, and we tried to carry
them out."

But if directing Air America was tough, flying for it was a death-defying adventure.

"We had one strip in Laos that was about 700 feet long, with a dog-leg in the middle,"
Grundy said. "It was on the side of a mountain, so part of it was supported by bamboo
poles. It's hard to imagine if you never saw it."

Nevertheless, the company attracted a rousing gang of former military fliers, crop
dusters and stunt pilots who loved the adventure and the good pay Air America
provided. They wore colorful nicknames like Squeaky, Willie Lump Lump and
Earthquake McGoon.

"You had a sense of adventure and patriotism, and it was the best flying you would
ever do," says Lee "Woo How" Howell of Lexington, an Air America pilot from about
1962 to 1971. "But it was hazardous. We bent up an awful lot of airplanes over there."

Nearly 300 Air America pilots were killed.

The operation ended after South Vietnam collapsed. Grundy returned to the United
States and worked in Miami until retiring and returning to Washington County in 1984.
Today, he minimizes his contribution.

"I had a lot of good people working with me; the credit goes to them," he said.

The saga of Air America inspired a 1990 movie of the same name, staring Mel Gibson
and Robert Downey Jr. But Grundy, like most Air America veterans, didn't think much
of it.

Read about Rewald, John Peyton, and the hit man, after the judges dies.....Rewald is
soon released from prison from a 80 year sentence. He had a bad back he "hurt" in
prison even though he played pro ball in the big leagues?

Judge Martin Pence is the key political judge from Hilo and the Big Island, involved the
earlier sugar labor strike wars. The Illicano Filipino labors were later brought in to
undermine the Unions which supported to the Democrats and the Hawaiian labor force
with Marcos and the Hawaii officials deceptively bringing in cheaper labor forces with
the Filipino economy in ruins from the Marcos corruptions allowing vast migration visas
to other places.

Judge Pence is the Democratic mole and political judge for present Supreme Court
Judge, Moon, who clerked under his tutoring. Judge Pence is originally from the
Kansas working farms and was sympathetic to the Hawaiian Sugar Labors and anti Big
Corporations like the Big Five use to dominate the Hawaiian Islands which is identified
with the Republican Party.....

A True Story of Lies by the CIA, and Abuse of Power by Federal Prosecutors Who
Will Do Whatever it Takes

By Brian Tamanaha

The Bush Administration and the Republican Congress have spewed out a constant
stream of exhortations about the need for secrecy, for allowing the CIA to do its job,
and for trusting federal prosecutors. In this time of heightened concern about terrorism,
it is not easy to appreciate the dangers of giving in to the demands of the Bush
Administration (as just occurred with the Military Commissions Act). Opponents are
painted as liberals or civil libertarians who exaggerate the potential danger with alarmist
assertions and abstract concerns about abuses unlikely to ever happen.

The following cautionary tale will help make the risks more concrete. It is about a young
federal public defender handling a case, United States v. Rewald, which involved the
CIA and several hundred documents containing classified information.

One day, about a month into the trial, following a grueling cross-examination by the
defense attorney of a witness from the CIA, which clearly harmed the government’s
case, the federal prosecutors asked the judge for a closed hearing. In the closed
hearing, with only the lawyers and the judge present, the lead prosecutor, from the U.S.
Department of Justice, requested that the judge hold the defense attorney in criminal
contempt for asking questions of the CIA witnesses that elicited prohibited classified
information in open court.

Despite the protestations to the contrary of the public defender, Federal District Judge
Harold Fong immediately agreed with the prosecutor. At that very moment, he ordered
that the public defender would be put on trial for three counts of criminal contempt 30
days after the completion of the ongoing trial.

Judge Fong also ruled that the public defender would be entitled to representation by
counsel, which signaled that the judge contemplated that the lawyer could be
sentenced to a year or more in prison if found guilty. The ongoing trial was recessed for
the remainder of the afternoon, but it resumed the next day as if nothing had happened.

I am able to recount the details of this event because the assistant federal public
defender was me, handling the case in the mid-1980s. To recap the hard-to-believe
basics of the situation: in the middle of a trial, I was charged with three criminal
offenses on the grounds that the questions I asked in open court prompted the
witnesses to disclose classified information. At the time of these supposed offenses,
the prosecutors objected neither to the questions nor the answers, and neither they nor
the judge gave any indication of a problem until the moment the charges were lodged
against me.

So there I was, still handling the ongoing trial, but now also facing my own trial to begin
30 days after the current trial was over. Despite my compromised position, I was not
allowed by the judge to withdraw as defense counsel, and our request for a mistrial in
the ongoing case was denied. I continued to examine witnesses from the CIA, but now
with pending criminal charges hanging over my head, and a real prospect of more to
come.

You might think this could never happen in the U.S. legal system, but this bizarre story
is true (doubters: check out U.S. v. Rewald), and played out in a federal court in Hawaii.
After I relate a few other details of the case, the relevance to our present situation will
be evident.

Rewald was running a Ponzi scheme. He set up an investment firm with a few initial
investors, and sent out regular statements indicating unusually high earnings, which
prompted additional investors to send money. Ultimately, he took in about $20 million
dollars. Unfortunately for the investors, a significant proportion of the money was not
actually invested.

When the story broke, Rewald claimed that he set up the entire arrangement at the
request of the CIA, to provide a cover operation to fund its activities in the Far East.
[Please hold the snickering skepticism for a moment.].

The CIA admitted that they had a relationship with Rewald, but claimed that it was
minimal. Rewald was merely a “phone drop.” He had a separate phone on his desk; a
few CIA agents in the field carried a business card with that number, and Rewald’s only
job for the CIA was to confirm to any inquirers that the person worked for him. Although
a number of former and then current CIA agents received money from Rewald, CIA
officials claimed that they too were duped by Rewald, and never would have used him
as a phone drop had they known about his criminal activities.

The scheme fell apart when a curious IRS agent happened to observe kids (Rewald's)
being dropped off at school every morning in a limousine driven by a chauffeur. After a
bit of preliminary checking, the IRS opened an investigation into the tax situation of
Rewald and his firm.

When he was informed by the IRS of the investigation, Rewald immediately notified his
contact in the CIA and asked what he should do. The CIA then provided Rewald with
three different stories to give the IRS investigators, and instructed him to pick one.

To repeat: they provided Rewald with entirely false, concocted stories with the
understanding that he would then give one of them to another federal agency in the
middle of a criminal investigation.

All of this sounds shocking enough, but there is an even more chilling point. In the
course of cross-examination, I confronted a CIA official with the document the agency
sent setting out the alternative stories for Rewald to tell the IRS. The official admitted
that none of the stories were in fact true. However, he insisted that they were not “lies.”
He said that they were “creative stories.” When I asked him to tell me the difference
between “lies” and “creative stories,” given that both are untrue, he said (I paraphrase):

“Untruths are not ‘lies,’ but 'creative stories,' when they are made up in the interest of
protecting the country. And the CIA is protecting the country.”

This was the testimony of a high ranking CIA official, under oath, in federal district
court. This kind of mindset, needless to say, can justify almost anything.

Now consider a bit of information about the prosecutors. The lead prosecutor in the
Rewald case was Theodore Greenburg of the Department of Justice. His second
was John Peyton, an Assistant United States Attorney in Hawaii. Curiously, prior to
joining the U.S. Attorney’s Office in Hawaii, John Peyton was the Chief of Litigation in
the CIA. Peyton claimed that his transfer to Hawaii soon after the inception of the
investigation into Rewald’s activities was a pure coincidence, and had nothing to do with
the involvement of the CIA in Rewald’s activities. Judge Fong denied our request to
remove AUSA Peyton from the case, finding that he had no reason to question
Peyton’s claim, although he also refused our request to order Peyton to produce
the personnel records connected to his transfer.

Ted Greenburg was lead counsel for the Justice Department in a number of cases
involving the CIA, including United States v. Wilson, which he prosecuted in the early
1980s. Wilson claimed in his defense that he was working for the CIA. At his trial, the
CIA submitted an affidavit denying that he was working for them at the time.

Two decades later, the CIA finally admitted that the affidavit was false. Wilson was
indeed working for them. It turns out, furthermore, that the prosecutors in the case knew
that the affidavit was false, but used it at trial anyway.In 2003, after he had spent
almost 20 years in prison, Federal District Judge Lynn Hughesvacated Wilson’s
conviction (289 F. Supp. 2d 801), observing:

In the course of American justice, one would have to work hard to conceive of a more
fundamentally unfair process with a consequently unreliable result than the fabrication
of false data by the government, under oath by a government official, presented
knowingly by the prosecutor in the courtroom with the express approval of his superiors
in Washington. (p. 816)

The court’s opinion identifies Ted Greenburg as the prosecutor who knowingly used
the false affidavit. But he was not alone: “The court has identified about two dozen
government lawyers who actively participated in the original non-disclosure to the
defense, the false rebuttal testimony, and the refusal to correct it.” (p. 811).

The relevance of this story for today should be obvious, and I will not belabor it. The
CIA will lie (or tell “creative stories”)—so don’t believe what you read about CIA
investigators stopping their harsh interrogations out of concern for liability—and lawyers
in the Justice Department will do whatever it takes to win a case. [Of course, there are
many superb lawyers in the Justice Department with integrity--Marty Lederman of
Balkinization was one of them.].

A thread that runs through this story is that the government actors involved were not
necessarily bad people—they were simply doing what they thought was necessary to
defend their country, and they used this end to justify their extreme conduct. That’s the
problem. When combined with power and with an unwavering conviction in the
correctness of one’s conduct, this mindset—which the Bush Administration oozes—can
lead to terrible abuses.

Those many people who think that the MCA is nothing to be concerned about—“nothing
bad will happen to good Americans, or to innocent people”—are being naïve.

This post has gone on far too long, so I will quickly wrap up the story I began with.
Rewald was convicted on mail fraud and tax charges and sent to prison.

Thirty days after the trial ended, three lawyers from the Justice Department (including
Ted Greenburg) flew back to try me on three counts of criminal contempt. Judge Fong
recused himself at our request, and Federal District Judge Marilyn Hall Patel came
from San Francisco to preside over my case.

I prepared a motion to dismiss the charges on the grounds that I had not in fact asked
questions that elicited unapproved classified information; indeed, in one instance the
testimony identified by the prosecutors as inappropriate had actually come following a
question interjected by Judge Fong. On the morning of my trial, while I sat at the table
as a defendant, Judge Patel dismissed the charges against me with prejudice.

If you research and confirm the Jack Kindschi CIA investigation on the mainland,
reported for him to be breaking down and crying after losing his elderly mother's
invested assets with the Hawaiian hui investors {reported to be over One Hundred
Thousand dollars} which can be documented and found in the New York Times archive
story, related to the 1984Peter Jenningsreport on ABC World News Tonight.

Question: Was all this public illusions and deceptions involving another bogus CIA
venture in the domestic United States of America an Illegal fact, or was this misleading
CIA public information which can be attributed to the Hawaiian political cover up and
obstructive pattern by the Hawaiian hui government investors linked to the future
Broken Trust Legacy associates with Goldman Sachs in Hawaii and Wall Street?

This also includes the former Hawaii Governor, John Waihee, given a "F" rating by
nonpartisan think tanks during his Administrations, who is presently under more elusive
and ambiguous State "investigations" with Political cover up damage control, for more
missing proceeds {reported between $9 Million dollars to $20,000 Million dollars} from
another Bankrupted Company in Hawaii {Right Star Management Company}.

The young Hawaii attorney, Brian Tamanaha, didn't apply to the Hawaii State Bar and
wasn't a member until a year or more after the Rewald "Kangaroo" Trail in Hawaii.
Future Whitewater prosecutor, Kenneth Starr, denied Mr. Rewald's motion for a
rehearing in 1990.

After Judge Fong dies in 1995, Mr. Rewald, a formerly physically fit water skier at a
high level and NFL journeyman running back with several NFL teams {Cleveland,
Baltimore, Kansas City}, was soon released a month later from a Federal Correction
Facility due to a "back injury" while in prison. He supposedly lives in the Los Angeles
area in a "rat infested" apartment with his family and life in ruins on $150 disability a
month pension.

~ ~ ~

"ASK NOT WHAT YOU COUNTRY CAN DO FOR YOU; ASK WHAT YOU CAN DO
FOR YOUR COUNTRY?" JFK

"Knowledge will forever govern IGNORANCE,"James Madison

SECRECY....THE FIRST REFUGE OF INCOMPETENTS?The House Committee on
Government Operations Report

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